Member Info for Yesimabeliever

Got into the FTSE 250 then diluted on day 1, passive fund buying just used to prop up the share price pre another fundraise.

Thanks for the share of the FT article. Seem to remember at the time Williams was pitched as virtually a “free” deal. Ingenuity services in return for advertising. What a mess.

As for the Great John Street shambles and property deals, no words for it.

Was Hale etc included in Beauty last year?

In fairness to GLA his “rubber stamp” has had a busy couple of years at THG, I’m sure he thinks he’s earnt every penny safeguarding shareholders interests 😂

@stockbroker, summary of key points on call:

- 10% beauty for q1 may not be as bad as it looks at first glance. Easter fell in April this year, plus leap year last year, plus some big Costco b2b business in US falls in Q2 this year also. Expect a bounce back in Q2, and overall mid digit growth in Beauty guidance confirmed

- Moulding confirmed a Beauty store roll out after success of Manchester (I wonder if Ashley is involved?)

- whey prices still very high, albeit new supply coming online so H2 should be better. THG “online” model at a disadvantage vs offline when whey prices rise because cheaper product in stores. THG online should bounce back as whey prices reduce, and their “real time” pricing becomes advantageous

Underwhelming result for me, wasn’t expecting -10% Beauty, Nutriton as expected.

Nice idea sorry!

I’ve idea sparsam.

If MM/GLA don’t act on that conflict before the AGM I’ll be there with my box of eggs!

When Iain McDonald did his presentation launching Selkirk, he talked about the challenges of trade investors buying stakes in divisions of plcs, and Selkirk providing a vehicle to facilitate it (it didn’t take a lot of reading between the lines to think he was possibly talking from experience of THG having trouble attracting in minority trade partners/into the Group).

A Selkirk bid for Myprotein could have been interesting if:

a) The bid included a trade investor that brought some FMCG expertise to the party

b) There was a sensible “premium”

Instead we hear there was a bid that offered no premium, no partners, and no detail. It all looks a bit silly (again!)

In fairness there was a leak/speculation, same source as last time Betaville, we all saw the small pop yesterday afternoon.

Whether you believe the bid was credible or not, it did need the RNS today.

Absolutely no detail provided by THG of any note, but according to Selkirk is was rejected on 1) value 2) Structure of offer 3) Deliverability of offer (ie funding) 4) lack of liquidity post deal

So it is more than just value and funding Selkirk need to deal with.

Call me cynical but to me it just looks like another "fake bid" to try and prop up the value of Nutrition ahead of poor Q1 numbers (due to elevated whey prices).

Selkirk just looks like another “fake bid” to me.

Iain McDonald had talked up Selkirk being a vehicle for a trade investor to take stake in a plc division.

No sign of that.

Just looks like a blatant attempt to try and use APN valuation to put a floor under the value of THG @ 2x APN.

Until there is a credible “bid” which doesn’t stink of being far to close to Moulding and his associates, best just ignored.

Cheers OohAah, I await with interest what Moulding serves up this time and the spin.

All eyes on Nutriton for me, both Q1 and any commentary on outlook with whey/FX starting to look slightly more favourable.

Beauty I do wonder whether they can hit the consensus organic growth numbers, last years numbers were enhanced by Biossance acquisition

I think we mostly agree that the plc BoD have been an abject failure. They can’t control performance, but things have got worse under their watch.

Governance improvements - we have the Moulding/Ingenuity conflict of interest now. That is a deterioration. No comment from the BoD/Chair.

Investor relations / worse than ever, we await the one man Moulding show to update us, maybe on the 30th if they get their act together, maybe not. Investors will be the last to know.

It’s an unstable workd out there, personally would rather see THG retaining cash in the short term rather than distributing.

We’ll have to wait and see the impact of tariffs on THG. Whilst it is priced for Armageddon, we have some reasons to be hopeful:

a) global infrastructure/local manufacturing may minimise disruption

b) possibly lower whey prices, in particular US market, early signs promising

c) improvements in JPY xrate

Whilst possibly inflationary in US, could Chinese goods being dumped into other markets might be disinflationary elsewhere. Lower rates in Europe will do THG no harm.

We live in hope

Oke, how do you know Ashley is in Ingenuity? He could well have nominated his full 10m into plc?

@multiplier agree it was hard to see Ingenuity demerged at EV of c£300m(allowing for leases), when Moulding inferred Apollo valued it at double that.

But of course if BoD had applied Apollo valuation in the demerger, then it would have implied Ingenuity was c50% of the value of THG plc at the time of the demerger which would of course been nonsense.

The way it was done allowed Matt to say valuation is irrelevant as everyone has the option to take up shares in Ingenuity if they so wished. If he had tried to raise external money into Ingenuity as a stand-alone entity as an alternative approach (it would have been more transparent), I think we would have all seen zero appetite from the market.

As it is, he has kicked the Ingenuity can down the road for a couple of years and he needs to find some new clients to make it work.

@multiplier Ingenuity was a different scenario.

It’s a loss making business, capturing zero “whales” in the last 2 years, and needed £100m to get it through to cash flow breakeven. Pretty clear now that QIA/Balderton/Sofina didn’t want to continue to fund it, and had a very different view of value to Moulding. Ingenuity wasn’t really fundable to new money due to 60% of revenues coming from THG, so they came up with the fudge solution where it was funded off the back of THG, and then shareholders had the choice whether to take up shares in Ingenuity or just stick with Remainco. By not taking up shares, Ingenuity was deemed to be worth next to nothing by Sofina/Balderton/QIA who didn’t take up any shares.

I can’t see the argument why investors would be prepared to do a similar deal for Nutriton, a business which during periods of “normal” whey pricing throws off significant cash and EBITDA. There would be “bidders” for that business, so no need for a fudge take private deal without a proper “process” and market tested valuation. Also, THG no longer needs capital with the refi in place for several years. So a totally different scenario IMO

Oke I’d be very suprised if Moulding repeated that deal structure again.

Ingenuity was a unique scenario, it was toxic with plc investors due to the cash drain, THG had run out of money to fund it, so it was a “solution” to remove it from the Group at a lowly valuation, but give investors the option to roll in.

Nutriton is a different beast. 18 months ago it was the jewel in the THG crown whilst people were moaning about Beauty’s poor margins. It was being talked up as a £1billion+ business. 2024 has been very poor due to the rebrand/FX headwinds/whey price spike, but it has a target 12.5% margin which it has historically delivered (sometimes beaten). If the rebrand and offline strategy can reignite growth, there is a route to a £100m EBITDA business. Even with little/no growth, £70-£80m EBITDA can

be delivered when FX/whey normalise.

Yes APN has higher margins off a much lower top line, but THG Nutritons model has some valuable attributes. It has millions of repeat customers on a D2C model (with potential to convert to subscription), it’s ahead of its peers in product innovation and moving into offline partnerships with mainstream FMCG (Iceland/Jimmys/Muller etc). I doubt QIA/Balderton/Sofina or other holders will let Moulding take that asset on the cheap due to cyclical whey prices. If it goes, it should be a proper arms length valuation/transaction.